Make full use of the means of counter payment fraud to avoid the risk of chargeback

The purpose of writing this article is to share with you the experience of preventing online payment fraud. This article will show you how to protect yourself and avoid fraud from consumers. By reading this chapter, we believe that you will also be able to acquire this ability. We write this in a simple and straightforward way and do not involve the use of hi-tech means. This way, you can immediately use the techniques in this article to provide anti-fraud protection for your online business.

For many users of the Web site, controlling costs is just as much as minimizing daily expenses. In fact, unpredictable losses are often responsible for the business crisis. Effective risk management, can avoid accidental loss, it is the best way to control costs. Chargeback is the most important source of risk for a large number of credit cards in lieu of cash transactions, and when the situation is serious, the cases of failure due to high loss or turnover are also heard. Therefore, the professional, efficiency, robustness is the primary consideration of the online sales business elements. Professional credit card Receipt third party payment provider not only can help the merchant to solve when the accident occurs, but also can fully instruct the merchant how to avoid the risk in advance. and efficient service can let the merchant in the first time solves the problem, avoids the income loss.

To counter fraud and help you avoid losses, this article will provide a series of automated anti-fraud methods that are implemented through cooperation with third-party payment providers or with the banking system. Third-party payment service providers will carry out fraud detection on every bank card transaction. These anti-fraud methods of third-party payment providers provide a high degree of protection that can be used as your first line of defense. Generally, third party payment service providers, together with the issuing bank, automatically check the following four areas through information systems to ensure successful payment:

? Card number is valid

? Card does not expire

? The card has no reporting loss record

? Have money in an account

In addition, you can further enhance your anti-fraud protection with the tools provided by Third-party payments. If the site is selling small, high-value deals, the most effective way is to investigate and check each transaction in detail. However, this approach may not be realistic for dealing with a large number of transactions, but there are other ways to choose. Let's take a third party payment service provider, Worldpay, as an example of a series of ways to guard against using Third-party payment tools, and you can use your own anti-fraud approach in a comprehensive anti-fraud strategy.

Payment Delay (Capture Delay) The time between payment verification and actual payment is postponed.

Payment delays are also referred to as pre-authorization, deferred payment or deferred processing. Payment delay, you can make a delay between the authorized payment and the actual payment. This allows you to have time to verify whether or not to perform or cancel an order. This is also very useful in preventing chargeback caused by fraudulent acts. When payment delays are not used, payment is directly authorized and funds will be automatically paid from the consumer's credit or debit card to the merchant account. When the payment delay function is used, the payment is authorized only when the payment is made, and the money will remain on the consumer's credit or debit card and will not be deducted until the payment (capture) is formally paid to the merchant account.

When a merchant uses payment delays, it is identical to the consumer's shopping experience when the payment delay is not used. Customers will not know if you have used payment delays. There is no additional charge for using payment delays. All you need to do is set up payment delay in your Worldpay account and choose the appropriate setup cart (Fastcart). If you choose to use payment delays, you can set a payment delay of 0-15 days, and when the delay expires, the payment will be automatically paid (capture) unless you manually cancel the transaction in your Worldpay account. Why use catch delay? Payment delays allow you to take time to consider whether to remove any dangerous, difficult or unwilling transactions when accepting online orders, thereby reducing the risk of chargeback.

This allows you to determine the delay between payment verification and actual payment (capture). When you consider whether to fulfill this order, it gives you time to evaluate the transaction. When payment is delayed in this way, it means that the funds have been owned by the issuer, but they are only being shifted: at the end of the time delay, when the automatic delay expires, if you are using automatic capture, or, when you use the Merchant administration Interface (MAI) gets paid. If payment delay (Capture Delay) is valid and is set to Automatic Capture, you must manually cancel the payment with Mai when you decide not to process the order.

For credit card payments and some ELV payments (often used in some European countries), you can activate the automatic capture delay with Mai or postpone the number of days for automatic capture settings. To avoid the risk of authorization termination, when you set up, you should pay attention to the length of the delay time. According to experience we suggest not to exceed 5 days. Note, however, that some card issuers are limited to a shorter period of time.

If you use a time delay, but turn off automatic acquisition, you will have to use Mai to manually obtain each payment. The caveat is that you should pay attention to the length of the delay and avoid the risk of expiry of the certification. Once the certification expires, this payment will automatically expire, can not perform the capture, and this order must be certified again, which means that the order has to be submitted to the payment service provider again through the card issuing bank certification.

Second, cardholder certification (cardholder authentication)

Cardholder Certification cardholder authentication for credit cards, through Visa (VBV) and MasterCard SecureCode (MCSCs) authentication is the Cardholder authentication method, This approach allows cardholders to prove their identity by using a password when shopping online. Cardholder certification for online fraud to provide you with more protection, because if the card issuing bank their identity is fully certified. Then you can be sure that the real cardholder is trading. The results of these inspections are provided to the risk management module, which can be used to monitor transactions and alert you to possible fraudulent transactions. In this way, you can avoid certain chargeback risks for Visa,mastercard and maestro transactions around the world. But be aware that scams using phishing techniques can get more than just the cardholder's card information, and possibly the password. You should be wary of this certification.

Third, withdrawal responsibility transfer (chargeback lliability shift)

When the buyer in person to use the card, each point of sale should be checked (for example, to a signature), the business card-making junior high school is to avoid the loss caused by fraud. The difference between online transactions is that you do not have handwritten evidence, the cardholder to buy products and services only use the information on the credit card. Therefore, the responsibility for causing loss is clearly the responsibility of the merchant itself. Although you cannot completely avoid the chargeback caused by fraud, you can use some effective means to reduce your loss, which is the withdrawal of responsibility transfer (chargeback lliability shift).

According to the transfer of responsibilities (liability Shift) established by MasterCard International and Visa International, you can also protect your own interests by transferring responsibility for the withdrawal, for Maestro and Mastercard,visa certification (VBV) and MasterCard SecureCode Certification (MCSCS) is a support for this provision. Responsibility shifts in Visa,mastercard and maestro transactions around the world (lliability Shift) will protect you from certain chargeback-related frauds, such as when consumers generate a payment "not-done".

According to the visa organization's data, 80% of chargeback are related to fraud. The responsibility for such chargeback is from merchants to Visa, MasterCard and Maestro card issuers, even if the issuer is not a participant in the scheme or the cardholder is not registered. Active certification has been raised to increase consumer confidence in online shopping and to reduce the exposure to information generated by fraud. It is important to note that some cards do not support certification or refund responsibility transfer, which means that you are responsible for the refund rather than the issuing bank.

Iv. avs/cvv2/cvc-Address/Security Code certification services

Address Confirmation Service (AVS) and card amount confirmation or card Safety Code confirmation (CVV2,CVC) are included in the business card planning, such as Visa/mastercard/amex by comparing the information entered by the shopper in the payment process with the information held by the card issuer. Neither of these services requires a merchant to pay an extra fee. It should be noted that while most card issuers support these tests, some do not support them.

Worldpay supports these authentication services by linking the issuing bank to the cardholder. The information entered by the shopper is transmitted to the Worldpay Cooperative Bank, which is then forwarded to the issuing bank and then compared to the information entered in the payment process and the information held by the issuing bank. The results of the comparison are returned to the merchant. Of course, the issuing bank must support AVS or CVV2,CVC, only in order to make a comparison of information.

You can check the results of these tests in merchant Administration Interface (MAI) and confirmation emails. These results are also grouped into the Risk Management module (RMM), which automatically causes vigilance if one or more detections fail. If the issuing bank does not support AVS or CVV2,CVC, there will be "no detection".

Address authentication Services AVS (addressing verification service). AVS enables the shopper to enter the billing address and password in the payment process to match the record of the issuing bank. Address verification service refers to the billing address that is required to fill out a credit card when paying, and this information can be compared to the bank, which gives the merchant a chance to discern whether it is a suspicious order. It should be reminded that AVS is not widely used outside the UK and the United States.

Secure Code authentication (security code verification). The Security Code Authentication service is the ability to allow the issuer to match the security Code entered by the shopper with the records they hold in the payment process. Security code is generally printed on the back of the card number. These numbers are not obvious and are not coded or printed on the receipts. So it is very difficult for others to know your password from above. This helps you avoid the ' cardholder not being present ' fraud.

The format and location of the

Security code have been rigorously designed. Some cards have a three-digit number printed at the end of the card's signature image. Some cards (AMEX) have a four-digit number in front of the card. For UnionPay's UnionPay standard card, called the CVN2, MasterCard, known as the Cvc2,visa card, uses the name Cvv2,ae Express card as CSC2. CVV2, CVC2, CVN2, CSC2 four kinds of names corresponding to the authentication code generation principle are the same, but different organizations have different names. CVV2 and CVC2 for verification code, is the bank card for indirect occasions, such as network payments, such as transaction use. can identify the presence of bank card transactions. It is generally seen in the last three digits of a series of signature strips on the back of a bank card. For UnionPay's UnionPay standard card, called the CVN2, MasterCard, known as the Cvc2,visa card, uses the name Cvv2,ae Express card as CSC2. But the principle is the same. If you need to prevent, please pay attention to my card do not let others brush, try to do not leave your line of sight card.